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November 27, 2014

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Like sewer rate plan? Depends

Proposal to raise rates in valley to pay for rural improvements would benefit some, hurt others

Clark County is considering an increase in sewer rates to help pay to replace deteriorating facilities in its rural areas — places such as Overton and Indian Springs.

If the new rates are approved, Las Vegas Valley ratepayers would effectively subsidize the improvements, raising concerns that developers will flock to the rural areas to take advantage of the new sewer rates and connection fees.

The proposal, introduced Tuesday, would create universal service fees and connection charges across unincorporated Clark County.

Right now, the Clark County Water Reclamation District is divided into six service areas: the Las Vegas Valley and five rural communities. Developers and property owners in each service area pay different connection and service fees based on operation, maintenance and expansion expenses in their area.

A sewer district citizens advisory group recommended changing that rate structure. But environmentalists, homebuilders and others fear the proposal would make development in rural areas less expensive than it should be. The result could be increased development in those areas.

For example, Las Vegas Valley resident Kevin Bushbaker would see the annual sewer service rates for his single-family home go up 33 percent over the next five years under the proposal, from $178.96 this year to $238.12 in 2012. About $20 to $25 of that increase would help pay for improvements in rural areas.

Bushbaker is also a developer. He is planning the 365-acre Town Square Logandale project in Moapa Valley. His project would benefit from a decrease in sewer connection fees. Right now, hooking a single-family home to the sewer system in Moapa Valley costs $7,050. Under universal rates, the fee would drop to $2,547 next year, rising to $3,137 by 2012.

“As a developer, I love it,” he said. “As a homeowner here in the Las Vegas Valley, I may not appreciate it.”

Do the math and it’s easy to see why. The concept plan for his development estimates 1,970 dwelling units. Assuming all of those will be single-family homes or the equivalent, Bushbaker’s project stands to save about $7.7 million in connection charges under the proposal.

Environmentalists and homebuilders are expressing concerns about the proposal.

“My concern is that the greatest factor affecting surface or ground water quality is population increase, and that effectively the existing residents of the urban area will be subsidizing continued explosive growth,” said Launce Rake, spokesman for the Progressive Leadership Alliance of Nevada. The Southern Nevada Home Builders Association opposes part of the proposal.

County Commissioner Chris Giunchigliani also raised concerns. “Our policy has been if you want the growth, you pay for it,” she said.

Still, commissioners asked the sewer district to bring back a formal proposal for a public hearing in May.

Rural communities certainly need new sewage treatment facilities. Collection ponds used to treat sewage were built in the 1960s or ’70s and are lined with asphalt, which is considered substandard today.

Ponds in Overton and Indian Springs are in the most dire condition. Nitrates are being absorbed into the ground water in excess of federal and state standards for safe drinking water. Nitrates are known to cause a potentially fatal blood disorder in infants called blue baby syndrome. Other collection ponds in Searchlight and Blue Diamond are also allowing pollutants to seep out.

As a result, sewer district officials say $114 million is needed over the next five years to build new treatment plants in rural areas.

The real difference between the current and the proposed fee structures becomes clear when considering the future rates in rural areas. With new treatment plants on the way, service rates under the current fee structure would shoot up $200 to $300 from current rates of $87.77 to $338.30 in the rural areas.

Connection fees would also jump. Current charges vary from $1,150 to $7,050, but would go up to $13,000 in some rural areas under the current structure. In the Las Vegas Valley, service rates would be only $4 or $5 less under the current structure than under the universal structure. The effect is much less significant because of the valley’s huge population.

That’s why the advisory group made the recommendation, said Lanny Waite, a Logandale resident and Moapa Valley justice of the peace who is a member of the district’s citizen advisory group.

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